Starting from 1920 RCA had been an electronic giant produced radios, and later, televisions, located in Philadelphia, a city of Camden. Aiming at profit maximization the company moved the parts of operating process several times inside of the US, and then abroad seeking for cheap workforce.
The major reason for moving a significant part of RCA operations is that the company intended to save labor costs by hiring people in rural areas, poor, young, uneducated, single, female and immigrants. Another fact that gives the evidence of this tendency is that RCA moved its plants several times during seventy years of its existence of the company. First RCA moved the operations from Camden to Bloomington, Indiana, then to Memphis, Tennessee, and finally to Ciudad Juárez, in Mexico (p.9). RCA preferences were centered over the locations that had little history of creating trade unions and plentiful cheap malleable workforce. The company followed the same scheme: each time when conflicts regarding wages, job security or the shop floor control arose, the management of the company shifted to another location using dirty tricks to break trade unions and threatening by closing plants.
The threat of capital flight did nothing but stimulated workers’ activity towards unionization forcing them to fight for their rights and develop trade unions in both cities. The story repeated once again following the same scenario (p.28). RCA plants were usually built in rural area where tendency for unionization was weak. The community was grateful for offering more jobs when it experienced hardships: Camden during Great Depression and Indiana rural area (Bloomington) with little development of industrial production. The company abused its preferred position by imposing strict rules for its workers: low wages, non-paid overtime work, and inhibition of trade unions organizing. Attempting to hold its positions the company used a threat of leaving in vain because workers had nothing to loose anymore as they were almost worked to death and could hardly make ends meet. Workers proceeded to assert theirs rights because RCA rejected any attempts to start bargaining.
RCA production had heavily relied on female workforce. The fact can be considered as the company human resource strategy since the industry as a whole did not depend on women workforce the same way that RCA did: 75% of 9,800 workers in Camden plant were women the same as in Bloomington (75%-80% of women workers) (p.17). When a part of production switched to Bloomington, the company implemented the same strategy: hiring young unmarried women aged 16-28 (sometimes up to 35). The rest of the workforce was supposed to be male, young, and white to perform hard physical work. Thus, the main similarity of Camden and Bloomington workforce was female workers preference for hiring. There were no particular differences in the strategy implemented by RCA either in Camden or in Bloomington. However, the number of female workers had an overall tendency to reduction from 1930 to 1998 conditioned by social changes (strong tendency to unionization, strikes, women fighting for their rights, etc.).
RCA attempted to hire docile workers who were not supposed to organize a union in the cities with little union activities and where the workforce was desperate to get any job. When RCA management realized that the trade union movement intensified, they made a decision of gradual shift to another region characterized by the features Camden had had when RCA first entered there. Bloomington, Indiana was the perfect place for this purpose. The unions in Camden proceeded with the activity despite of the threat of leaving declared by RCA. Taking advantage of its privileged position, RCA rejected to sit down at the negotiating table together with union leaders choosing to further take advantage of work discrimination. Trade unions continued to fight for the workers’ rights demanding wage increase, thirty-five-hour workweek, the company union abolition, and signing union shop contract implemented at Philco (RCA nearby competitor) (p.22). However, even supposedly docile workforce would likely to organize trade unions when job is not secure and the wages are discriminative.
RCA was not interested in unionization of its workers since it enjoyed cheap and docile workforce allowing significant economy on the wages. When the production had been gradually redirected to Bloomington, the management of the company motivated this shift by hiring more professional workforce to eliminate potential conflict (p.50). The aim was to remove any attempts to solidarity concealing RCA true motives. This was also the reason of disturbance of national and international unions’ activity because this activity would likely stop RCA continuous advantage taken from hiring cheap workforce. As there were no any repelling force, RCA continued to enjoy relocation advantages for more than 70 years of its existence choosing the regions where trade unions were weak or absent. As US union activity was strong in 90’s, RCA proceeded with the strategy chosen long ago: the production shifted to Taiwan – the country where trade unions were weak in then and the workforce was desperate for any job.
I think that if the union movement and the working people communities combined their efforts and set up claims demanding from RCA to stop its relocation policy. The process of the constant relocation could have been halted if trade unions succeeded to attract government and world organizations attention to the problem (p.209). For example, they could apply to the court or to the government, or both to inform about the problem rather than fighting separately. If there is an appropriate regulation reflected in the labor legislation, RCA would submit it. This would allow avoiding many violations made by RCA.
I also consider that workers did not have enough bargaining experience and communication skills to adequately set up their requirements. There must be a labor code of the company to regulate relationship between employers and employees so they could build adequate labor relationships. Is they had they would definitely succeed. It is not likely that RCA moved anyway from Camden and further. Unionization was the main stimulus of production moving away. The workforce was dissatisfied with the working conditions and the wages. The activity of unions increased every year and workers organized more strikes fighting for their rights and stimulating social changes. Trade unions exerted significant pressure on the companies’ owners to initiate collective bargaining processes.
On the other hand, highly competitive environment required best products at a fair price. There was a choice for RCA: to stay in the country being out of business or to move to another country saving on labor costs. RCA was forced to move to stay in business and be able to compete its rivals. Economists’ views are divided whether the market can or cannot be regulated by the government. RCA would have been forced to seek for cheaper workforce anyway, but it is not clear what would happen if there was an appropriate government regulation.
The unions’ movement was not properly organized because there was no any experience of similar activity before. In addition, unions were locally organized, they were neither national nor international. Besides, unions consisted mainly of women who participated in strikes but the level of their engagement was difficult to identify (p.27). Women by nature are more accommodative, uncomplaining and tolerant. This is what exactly RCA supposed of their workers. Also, the unions must be national and international so the workers could exchange information and organize protest actions simultaneously. For example, if Camden and Bloomington workers know about RCA intentions, they could organize collective protests actions in these two cities requiring adequate wages for workers in both cities.
Besides, unsatisfactory labor legislation gives the opportunity to further abuse. The authors convinced the readers that the US system of industrial governance is not satisfactory and that the US cannot set standards for WTO (p.204). The authors stated that before being introduced to the international organizations, there must be developed meaningful labor legislation. If the consolidation of trade unions and workers’ communities was supported by appropriate labor legislation regulating capital outflow, RCA would possibly give up the idea of relocation. The problem is very important since it concerns every wage earner. If RCA workers did not begin to fight for their rights long ago it is likely we do not have the level of democracy we have nowadays. The problem that is muted cannot be resolved because of being considered non-existent.
Another issue is that capital outflow is considered normal. The legislation is lobbied by the industry giants owners disregarding the interests of the working people. Huge US capitals are generated abroad but the unemployment rate does not improve. The national labor issues regulating system must serve the interests of people whether they are from local, national of international community because the welfare of the country or the world depends on the welfare of its citizens (p.209). The government must encourage RCA not to relocate its production outside the US. RCA took advantage from offshoring and outsourcing. However, relocation of the production out of the country will not improve US unemployment rate and budget deficit.
Contemporary US labor legislation is far from being perfect. Despite of the fact, it was proposed to be a basis for WTO regulation.
It seems that the US regulation will not help in this situation. There must be an appropriate transnational labor regulation to achieve the goals attained (p.206). Meanwhile some the communities stay depressed and people from those communities are still unemployed.
An appropriate legislation is important since it will form a basis for the right relationships between employers and employees. If the production and capital would move to other countries, US workforce has nothing but to move there either and be paid less not to stay outside of this move. We must not afford to keep taking it a day at a time because we need to leave better world for subsequent generations.
The authors tried to attract public and government attention to the problem of racial, social, gender and economic justice. The problem of capital outflow from the country conceals another big problem: free market regulation by the government because RCA constant relocation was caused by free market conditions.
Cowie, Jefferson R. Capital Moves: RCA's 70-Year Quest for Cheap Labor. New York: New Press, 2001. Print.